Flipkart to sell meat and vegetables with new entity FarmerMart

The new food retail subsidiary will focus on the business of retailing food products including grocery, meat, vegetables, and flowers. The development comes at a time when there is speculation of Walmart hiving off digital payment vertical business, PhonePe, into a separate entity.

Ecommerce major Flipkart has set up a new food retail company called Flipkart FarmerMart Private Limited in Bengaluru to operate its food retail business. Set up with an authorised capital of Rs 1,845 crore, the Walmart-owned company will take on ecommerce players like Bigbasket, Amazon India, and other online grocery, meat, and vegetable sellers.

Filings made by the company with Registrar of Companies (RoC) said, the company will “carry on interalia, the business of retail trading of food products (manufactured and/or produced in India) through offline and online distribution and other sales channels (including by way of ecommerce through web, mobile or any other online/digital channel); invest in or set up infrastructure throughout India in relation to such business and providing all other related and ancillary services for efficiently undertaking retailing of food products in India”.

Flipkart grocery

Apart from indulging in storage, warehousing, transportation, and handling of all kinds of transport service and business, the filing said, the company will also carry on the business of packers of all foods - from agriculture products, dairy products, horticulture and poultry products, fruits, vegetables, flowers, meat, processed meat, tinned and processed foods, fast foods, processed fish and sea foods, frozen foods, potential foods, health and instant foods of all kinds, including baby and diabetic foods, cereals, beverages, restoratives and aerated mineral water, consumable provisions, by-products, derivatives, food preparations of every kind and description”.

Commenting on the move, Kalyan Krishnamurthy, Flipkart Group CEO, said,

"In line with the Government of India’s FDI policy, which allows 100 percent FDI in food retail for food produced and manufactured in India, Flipkart is applying for appropriate licenses from the government. We’ve secured all internal approvals for the same already. The newly-registered local entity - ‘Flipkart Farmermart Pvt Ltd’ - will focus on food retail, and is an important part of our effort to boost Indian agriculture as well as food processing industry in the country. We’re looking forward to invest more in the local agri ecosystem, supply chain and working with lakhs of small farmers, Farmer Producers Organisations (FPOs), food processing industry in India, helping multiply farmers' income and bring affordable, quality food for millions of customers across the country".

The Indian ecommerce major first formally announced the launch of Flipkart Supermart in August 2018, after it was acquired by US retailer Walmart. During the launch of Supermart in western India, Flipkart said it expected to collaborate with farmers, producer organisations, and local micro, small and medium enterprises (MSMEs) to create a sustainable ecosystem and add jobs.

While it is still not clear how Flipkart's plans to foray into meat and processed meat business will affect players like FreshToHome, Licious, and others, one thing is certain that micro delivery or hyperlocal delivery is coming under aggressive competition regime in India.

Today, millennials, due to paucity of time, have been leveraging hyperlocal delivery startups to order their day-to-day grocery and other items that gets delivered at their doorsteps.

Alibaba-backed Bigbasket and SoftBank-backed Grofers are the leading online grocers in India at present. While ecommerce giants Amazon and Walmart-owned Flipkart are in the game, food delivery unicorn Swiggy and all-rounder Dunzo have added grocery to their repertoire.

While there are reports about the shutting down of Doodhwala, it seems the sector is waiting for a huge round of consolidation. Bigbasket, last year, acquired Pune-based RainCan and Bengaluru-based Morningcart for its micro-delivery service BBDaily. 

The sector also saw the entry of deep pocketed Swiggy and Dunzo adding grocery to their offerings. Amazon India, in August this year, launched Amazon Fresh store on Amazon.in for select pin codes in Bengaluru. Before that, Amazon used to sell grocery only through Amazon Pantry and Prime Now. Now, Amazon Fresh complements these two arms of Amazon to provide a complete grocery experience to customers.

(Edited by Megha Reddy)


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